Rhode Island

Overview

The Rhode Island Retirement Board oversees the Rhode Island Employees’ Retirement System, which is made up of seven defined benefit plans and one defined contribution plan. These plans include the Employees' Retirement System, for state employees; the Teachers’ Survivors Benefits plan; the Municipal Employees' Retirement System; the State Police Retirement Benefits Trust; the Judicial Retirement Benefits Trust; the Judicial Retirement Fund Trust; the State Police Retirement Fund Trust; and the Rhode Island Defined Contribution Plan. Together these plans provide retirement benefits for most public employees in the state; some Rhode Island cities maintain their own retirement system. The ERS board includes 14 members.

RI ERS assets are managed by the State Investment Commission, which is housed in the office of the state treasurer.

Plan Design

All new hires into ERS since 7/1/12 participate in a hybrid, DB-DC plan. In addition, current active members with less than 20 years of service as of 6/30/12 were transferred from the DB plan to the hybrid DB-DC plan.

According to the US Government Accountability Office, 77 percent of employees of state and local government in Rhode Island participate in Social Security. Approximately one-half of public school teachers in the state do not participate in Social Security.

Access plan design detail

Authorizing Statutes and Board Structure

Rhode Island General Laws Title 36 establishes the Rhode Island Retirement System and prescribes the composition and duties of the board.

Details regarding the composition of these and other retirement boards is accessible via the Retirement and Investment Board Characteristics search tool located at the bottom of this page.

Fiduciary Duty/Prudence Standard

Rhode Island General Laws Chapter 35-10
The commission is authorized and empowered to execute the disposition and investment of the funds which are within its control in accordance with the prudent person standard as defined in this subsection. The commission shall adopt a statement of investment objectives and policies consistent with the prudent person standard. Management and professional expenses incurred by the commission in the furtherance of this section shall be paid from the funds in an amount required for these expenses. For purposes of this subsection, the prudent person standard shall be that standard of care employed solely in the interest of the participants and beneficiaries of the funds and:
(1) For the exclusive purpose of:
(i) Providing benefits to participants and their beneficiaries; and
(ii) Defraying reasonable expenses of administering the funds;
(2) With the care, skill, prudence, and diligence under the circumstances then prevailing that a prudent person acting in a like capacity and familiar with these matters would use in the conduct of an enterprise of a like character and with like aims; and
(3) By diversifying the investments of the fund so as to minimize the risk of large losses, unless under the circumstances it is clearly prudent not to do so.

Legal Protections of Retirement Benefits

No explicit constitutional protection exists for public pension benefits, but courts protect contractual pension rights based on impairment of contract principles. Nonnenmacher v. City of Warwick, 722 A.2d 1199 (R.I. 1999) (vested contractual rights might not be violated where the impairment caused by a change in benefits is "not substantial"); Rhode Island Council 94 v. Carcieri, 2011 WL 4198506, *1 (Trial Order) (R.I.Super. Sep 13, 2011) (statutorily-created pension system establishes a contractual relationship with the state; trial court denied defendant's' motion for summary judgment after plaintiffs challenged benefit and COLA reductions). (Rl CONST., Article 1, §12) Source: Robert Klausner, Esq., State Constitutional Protections for Public Sector Retirement Benefits
 

See also the following search tools:

More Data

• Public Fund Survey Summary of Findings
• Roll Call (NASRA members-only)